Coffee, tea, and oreo cookies

Technical topics regarding tax preparation.
#1
JAD  
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What are you all doing with the cost of office snacks? I've heard different theories: 50% deduction based upon the changes to 274(n) and the plain language of 274(e)(1), a form of employee recreational expense 100% deductible under 274(e)(4) & 274(n), fully deductible under 132(e) de minimis fringe benefit.
 

#2
sjrcpa  
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Technically, they are 505 deductible. Practically, I think they appear in Office Supplies and are fully deducted.
 

#3
WEISSEA  
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IRC §274(e)(4) specifically provides an exception to the limitations rules for “expenses for recreational, social, or
similar activities (including facilities therefor) primarily for the benefit of employees.” IRC §274(e)(4) wasn’t changed by the TCJA. These activities remain 100% deductible.
 

#4
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So my tax food is fully deductible? Oooh let's get more M&M's, Hershey Dots and Girl Scout Cookies! Yum.
 

#5
Jake  
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I am going to chalk my Budweiser up as office supplies and see if that works.
 

#6
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I am going to assume 100 percent deductible and fully deductible are different amounts.
 

#7
Wiles  
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Jake wrote:I am going to chalk my Budweiser up as office supplies and see if that works.


C'mon. Uncle Sam is picking up the tab for part of this. You can upgrade.
 

#8
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It's my understanding office snacks are 50% deductible for 2018-2025. 0% after.

I believe only office parties/outings, reimbursed meals to employees, meals included in compensation, etc are 100% for 2018-2025.

But again most businesses are probably running them through the supplies account. We'll need to scrutinize for that.
 

#9
Nilodop  
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We'll need to scrutinize for that.. What does that mean? Audit?
 

#10
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We'll need to scrutinize for that = I'll ask if there are any coffee, tea, or oreos expenses in the office supplies account.

I don't audit, even on my best days.
 

#11
JAD  
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Just released, PLR 201903017. I'm not reading it now, but RIA summarizes issue 8 as saying that snacks are excludable from gross income as a de minimis fringe benefit under 132(e)(1). Therefore, I am going with fully deductible. Great timing for the PLR, right?
 

#12
Joan TB  
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Last time I had an IRS auditor in my office, he ate a whole box of my Thin Mints. Dang right I am deducting these snacks!
 

#13
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I work out of my home. If I put a small pantry and mini-fridge in my dedicated office, can I expense the food and drinks as snacks as long as I tell my wife to not raid my stash? :D
 

#14
Nilodop  
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Result was a no-change, right? Out-of-pocket expense chargeable to client.
 


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